Will You Need to Hire a Probate Lawyer?

Not every executor needs professional help.

If you read the conventional advice for executors, the first
step is usually “hire a lawyer.” And you may well decide, as you wind up an
estate, that you want legal advice from an experience lawyer who’s familiar
with both state law and how the local probate court works. Not all
executors, however, need to turn a probate court proceeding over to a lawyer or
even hire a lawyer for limited advice. If the estate that you’re handling and
doesn’t contain unusual assets and isn’t too large, you may be able to get by
just fine without a lawyer’s help.

To determine whether or not you may be able to go it alone,
ask yourself the questions below. (If
you don’t know the answers, ask a lawyer—before you agree to hire the lawyer to
handle things for you.) The more questions you answer with a “yes,” the more
likely it is that you can wrap up the estate without a professional at your
side.

Can the deceased person’s assets be transferred outside
of probate?The
answer to this question depends on how much (if any) probate-avoidance planning
the deceased person did before death. Ideally, all assets can be transferred to
their new owners without probate court. Some common examples of assets that
don’t need to go through probate are assets are held in joint tenancy, survivorship
community property, or tenancy by the entirety. Assets held in a living trust
can bypass probate, too. Probate is also unnecessary for assets for which the
deceased person named a beneficiary—for example, retirement accounts or life
insurance policy proceeds.

Does the estate qualify for your state’s simple “small
estate” procedures? It’s best if no probate at all is required,
but if that isn’t an option, figure out whether the estate can use “small
estate procedures. In most states, these include streamlined “summary probate” and
an entirely out-of-court process that requires presenting a simple sworn
statement (affidavit) to the person or institution holding the asset. Every state has
its own rules on which estates can use the simpler procedures. But in many
states, even estates that are fairly large—not counting nonprobate assets—can use
the simpler processes.

Are family members getting along?Will
contests are rare, but if a family member is making noises about suing over the
estate, talk to a lawyer immediately. Probate
lawsuits tear families apart and can drain a lot of money from the estate in
the process. A lawyer may be able to help you avoid a court battle.

If probate is necessary, is your state’s probate process
relatively simple? If
the state where the deceased person lived has adopted a set of laws called the Uniform
Probate Code, probate should be pretty straightforward. In UPC states, most
probates are conducted with minimal court supervision. A few other states have simplified
their procedures without adopting the UPC.

Does the estate contain only common assets, like a house,
bank or brokerage accounts, vehicles, and household goods? Things get much more complicated when an
estate includes a business, commercial real estate, or any other asset that
requires special ongoing handling. You’ll
probably want to consult experts if you need to manage, appraise, or sell a
business; these jobs aren’t for amateurs.

Is there enough money in the estate to pay debts?
If there’s enough money to pay legitimate debts (for example, final income
taxes, expenses of the last illness, and funeral costs), with some left
over for beneficiaries under the will or state law, you won’t have to figure
out which debts to pay. If, however, your initial investigation reveals that
there may not be enough money in the estate to pay debts and taxes, don’t pay
any bills before you get legal advice. State law gives some creditors priority
over others.

Is the estate too small to owe either state or federal estate
tax? Under
current law, more than 99.7% of all estates don’t owe federal estate tax, so you
probably don’t need to worry about that. There’s a greater chance (though still
a small one) that the estate will owe a separate state estate tax to the state
where the deceased person lived or owned real estate. Close to 20 states impose
their own estate taxes, and many of them tax estates that are valued at $1
million or larger. You’ll certainly need expert legal and tax advice if the
estate must file an estate tax return, either with the IRS or the state taxing
authority.

For information about state taxes, including a list of the
states that impose them, see “State Estate Taxes.”